In 2015, Distressing Matters reported on the Third Circuit's decision in In re Jevic Holding Corp. , wherein that panel ruled that, in rare circumstances, bankruptcy courts may approve the distribution of settlement proceeds in a manner that violates the Bankruptcy Code's statutory priority scheme. The Third Circuit's opinion endorsed the Second Circuit's “flexible approach” solution to that question and rejected the Fifth Circuit's finding that settlements must be “fair and equitable,” and thus comply with the priority scheme, as “too rigid.”
